Classical economists think general equilibrium is attained relatively quickly because
A)the real interest rate adjusts quickly.
B)the level of output adjusts quickly.
C)the real wage rate adjusts quickly.
D)the price level adjusts quickly.

Question

Quizplus · Accepted Answer

Classical economists believe that markets are efficient and flexible, with prices adjusting quickly to attain equilibrium. Therefore, the price level is expected to adjust quickly to eliminate any excess supply or demand in the market. In contrast, changes in real interest rates, output, and wage rates may take longer to adjust to restore equilibrium.

Classical Economists Think General Equilibrium Is Attained Relatively Quickly Because